UPDATE: Trump Administration rescinds memo that aimed to freeze certain federal funding, including loans and grants
WASHINGTON, D.C. & ALBANY, NY- The memo issued by President Donald Trump's budget office this week, which aimed to put a freeze on certain federal funding, including things such as loans and grants, was rescinded on Wednesday.
The memo initially was intended to allow for proper review on whether certain spending aligned with Trump’s latest list of executive orders on issues like climate change, diversity, and others.
After a wave of confusion and legal challenges across the country, the administration reversed its course and rescinded the memo.
For context, a Federal Judge temporarily blocked part of the freeze, with aims of allowing consideration for a challenge brought up by a group of non-profits.
Despite the confusion, Trump's Office of Management and Budget remains adamant that their intentions focused around the obligations for federal agencies abided to Trump's executive orders.
White House press secretary Karoline Leavitt blamed the confusion on the courts and media, not the administration.
Still, New York authorities did not hold back with blasting the original memo, including figures such as U.S. Senator Charles Schumer (D-NY). He claimed that such federal investments were approved in Congress and it is illegal for the President to cancel them.
“No matter how much he believes he does, the president does not have the authority to ignore the law,” the Senator said in a released statement.
“We will not stand for any illegal policy that puts essential services for millions of Americans at risk,” New York’s Attorney General Letitia James added.
“We work tirelessly overnight to ensure that that does not happen.”
“In the hours since the federal government released their memo threatening to slash $3 trillion in federal funding, millions of New Yorkers have voiced their fears that this unprecedented step would take away their health care, defund their local law enforcement agencies, block repairs to roads and bridges and so much more," said New York Governor Kathy Hochul.
The Trump White House provided a Q&A form to the original memo, which is available below:
In implementing President Trump’s Executive Orders, OMB issued guidance requesting that agencies temporarily pause, to the extent permitted by law, grant, loan or federal financial assistance programs that are implicated by the President’s Executive Orders.
Any program not implicated by the President’s Executive Orders is not subject to the pause.
The Executive Orders listed in the guidance are:
Protecting the American People Against Invasion
Reevaluating and Realigning United States Foreign Aid
Putting America First in International Environmental Agreements
Unleashing American Energy
Ending Radical and Wasteful Government DEI Programs and Preferencing
Defending Women from Gender Ideology Extremism and Restoring Biological Truth to the Federal Government
Enforcing the Hyde Amendment
Any program that provides direct benefits to individuals is not subject to the pause.
The guidance establishes a process for agencies to work with OMB to determine quickly whether any program is inconsistent with the President’s Executive Orders. A pause could be as short as day. In fact, OMB has worked with agencies and has already approved many programs to continue even before the pause has gone into effect.
Any payment required by law to be paid will be paid without interruption or delay.
Q: Is this a freeze on all Federal financial assistance?
A: No, the pause does not apply across-the-board. It is expressly limited to programs, projects, and activities implicated by the President’s Executive Orders, such as ending DEI, the green new deal, and funding nongovernmental organizations that undermine the national interest.
Q: Is this a freeze on benefits to Americans like SNAP or student loans?
A: No, any program that provides direct benefits to Americans is explicitly excluded from the pause and exempted from this review process. In addition to Social Security and Medicare, already explicitly excluded in the guidance, mandatory programs like Medicaid and SNAP will continue without pause.Funds for small businesses, farmers, Pell grants, Head Start, rental assistance, and other similar programs will not be paused. If agencies are concerned that these programs may implicate the President’s Executive Orders, they should consult OMB to begin to unwind these objectionable policies without a pause in the payments.
Q: Is the pause of federal financial assistance an impoundment?
A: No, it is not an impoundment under the Impoundment Control Act. It is a temporary pause to give agencies time to ensure that financial assistance conforms to the policies set out in the President’s Executive Orders, to the extent permitted by law. Temporary pauses are a necessary part of program implementation that have been ordered by past presidents to ensure that programs are being executed and funds spent in accordance with a new President’s policies and do not constitute impoundments.
Q: Why was this pause necessary?
A: To act as faithful stewards of taxpayer money, new administrations must review federal programs to ensure that they are being executed in accordance with the law and the new President’s policies.
Albany, NY Capitol Plaza image.
